In Kentucky a new law was introduced regarding new requirements for mortgage lenders and brokers. HB 552 changes the license surety bond requirements for mortgage lenders and mortgage brokers. Under existing law, lenders are asked to obtain a surety bond of $250,000 while brokers are required to post a $50,000 bond. The surety bond amounts remain unaffected, but HB 552 allows the Executive Director of the Office of Financial Institutions to recoup expenses, fines, and fees that they have levied from the surety bond. Additionally, the new law permits the Executive Director to make recovery for borrowers and clients undergoing losses or damages as a result of the licensee’s disobedience of the law. Existing law already allows direct actions on the bond from consumers. HB 552 became active upon enactment under emergency announcements linked to the present condition of the mortgage industry.
Eric is the Chief Marketing Officer of JW Surety Bonds. With years of experience in the surety industry, he is also a contributing author to the surety bond blog.